Obeid nephew spoke of cafe lease troubles

Former NSW Labor MP Eddie Obeid's nephew vented to him about a long-running lease dispute involving two of the family's Circular Quay businesses, a court has heard.

Real estate agent Dennis Jabour says he was involved in the lease negotiations and held concerns about how the agreements were being handled by the NSW government.

Mr Jabour gave evidence on Monday at the third day of his uncle's criminal trial for wilful misconduct in public office while serving as a state upper house MP.

Obeid is accused of failing to disclose his family's interest in the two waterfront cafes, Cafe Sorrentino and Quay Eatery, when making representations in 2007 to a senior bureaucrat about the plight of leaseholders.

The 72-year-old has pleaded not guilty to the charge.

His lawyers have argued he did not engage in misconduct simply by asking NSW Maritime Authority deputy chief executive Steve Dunn to meet with a mediator acting for a number of tenants including a company linked to the Obeids.

Mr Jabour said he was of the opinion that the department was bordering on breaching the Trade Practices Act in its dealings with lessees.

"I vented a lot about the government's policy," Mr Jabour told the NSW Supreme Court.

"To Eddie Obeid?" crown prosecutor Peter Neil SC asked the witness.

"To anyone that would listen," he replied.

"Half the time I don't think he (Obeid) listened to what I said ... a lot of the time it seemed like he was somewhere else."

Earlier on Monday, Damian Obeid, the accused's eldest son, said the family's Hunters Hill home may have been used as security to purchase the two cafes in 2002, but said the topic was never discussed with his father.

Mr Obeid said his father was not involved in the day-to-day operations of the businesses and that leveraging off family assets for finance was a normal part of their business dealings.

The court heard he collected about $1000 cash from the Circular Quay cafes each week which he paid to his mother as a housekeeping allowance, but said similar payments had been made for at least the past 20 years.

The court heard both businesses were granted new leases in 2008 but Damian Obeid said they eventually went bust under the weight of "very, very harsh" new agreements.

The trial continues on Tuesday.